Convention on
the Settlement of Investment Disputes between States and Individuals and Legal
Entities of Other States (ICSID);

other international agreements.

National
legislation

Constitution of
the Republic of Belarus (fundamental law of the Republic of Belarus)

The Law
of the Republic of Belarus of July 12, 2013 ”On Investments“ (adopted in 2013)
provides foreign investors with equal business conditions and no less favorable
regime than the corresponding one for individuals and legal entities of the
Republic of Belarus.

According to the Law of the
Republic of Belarus ”On Investments“, investments are any property and other
objects of civil rights that belong to the investor by right of ownership, other legal basis, allowing him to
dispose of such objects invested on the territory of the Republic of Belarus by
the methods provided for in this Law, in order to make a profit (income) and
(or) to achieve other significant results or for other purposes not related to
personal, family, household or other similar use, in particular:

movable and real property including stocks, shares in the registered capital,
equity interests in the property of the commercial organization established on
the territory of the Republic of Belarus, monetary funds, including the
attracted, among them loans and credits;

the
rights of claim with assessment of their value;

Other objects of
civil rights, with an assessment of
their value, except for the types of objects of civil rights, the circulation
of which is not allowed (objects taken out of circulation).

On the territory of the
Republic of Belarus investments shall be made by the following methods:

creation of a commercial organization;

acquisition,
creation, including by means of construction, of objects of immovable property,
except determined by paragraph 4 of Article 2 of the Law;

acquisition of
rights on the objects of intellectual property;

acquisition of
stocks, shares in the registered capital, equity interests in the property of
the commercial including the cases of increase of the registered capital of the
commercial organization;

on the concession basis;

Other methods,
except for those prohibited by the legislative acts of the Republic of Belarus.

Under the Law of the Republic
of Belarus «On Investments” investors are guaranteed:

free transfer
outside the Republic of Belarus of the profit (income) and other legally
obtained monetary funds related to making investments on the territory of the
Republic of Belarus, as well as the payments made in favor of the foreign
investor, and related to making investments, after the payment of taxes and
levies (duties) and other obligatory payments established by the law of the
Republic of Belarus to the national and local budgets, state non-budgetary
funds;

the right to
sell their property and non-property rights in accordance with the law of the
Republic of Belarus;

the exclusive
rights to the objects of intellectual property;

the right to use land plots, rent,
property in accordance with the law of the Republic of Belarus on the
protection and use of land;

The right to create commercial organizations on the territory of the
Republic of Belarus with any volume of investments, in any organizational and
legal forms stipulated by the law of the Republic of Belarus, subject to the
restrictions established by
Article 6 of the Law of the Republic of Belarus «On Investments».

the right for benefits and preferences when making investments into the
priority types of activities (sectors of economy), and in other cases
established by the legislative acts of the Republic of Belarus and (or)
international legislation that are mandatory for the Republic of Belarus;

the right for the attraction to the Republic of Belarus of foreign citizens
and stateless persons for work;

the right for the conclusion of the agreement (agreements) with the
Republic of Belarus;

the right for protection of property against nationalization and
requisition;

free transfer of the compensation for foreign investors outside the
Republic of Belarus;

The right to pre-trial settlement agreement.

Benefits and policy preferences are implemented in the
Republic of Belarus, especially in free economic zones, small and medium towns,
rural area, High-Tech Park.

Additional guarantees and
incentives are provided to investors for investment projects implementation in
free economic zones, HTP, special tourist and recreation park "Avgustov
Canal", Industrial Park, small and medium towns, rural areas, as well as
to small and medium businesses.

For reference:

Tax Code of the
Republic of Belarus,

Decree of the
President of the Republic of Belarus as of 22.09.2005 №
12 (ed. 02.12.2013) ”On High-Technology Park“,

Edict of the
President of the Republic of Belarus as of 26/05/2011 № 220”On
creation of a special tourist and recreation park ”Avgustov Canal“,

Edict of the
President of the Republic of Belarus as of 05.06.2012 № 253 (ed. 13.06.2013) ”On
China-Belarus Industrial Park“,

Decree of the
President of the Republic of Belarus as of 07.05.2012 № 6 (ed. 11.09.2013) ”On
stimulation of entrepreneurial activity on the territory of small and medium
towns, rural areas“.

Since 2009 the concept
«investment agreement with the Republic of Belarus has been operating
successfully.

For reference:

Decree of the
President of the Republic of Belarus as of 06.08.2009 № 10”On
creation of additional conditions for investment activity implementation in the
Republic of Belarus“(ed. Decrees of the President of the Republic of Belarus as of 13.09.2010 №
7, of 06.06.2011 № 4, of 31.01.2013 № 3), Decree of the President of the
Republic of Belarus as of 06.06.2011 № 4 ”On introduction of amendments and
changes to the Decree of the President of the Republic of Belarus of 06.08.2009
№ 10“.

Investment agreement is one of
the possible forms of public-private partnership. Investor receives additional
guarantees and preferences through signing such an agreement. There is also a
possibility to receive individual preferences.

For the aims of its
implementation the following regulations were adopted: Regulation on the order
of conclusion, change, termination of investment agreement with the Republic of
Belarus; Regulation on the order rules of the State register of investment
agreements with the Republic of Belarus; Regulation on the coordination order
of the list of goods (works, services), property rights, objects,
acquired (imported to the territory of the Republic of Belarus) and used for
designing, construction (reconstruction), fitting-out in the investment project which is implemented
according to the investment agreement with the Republic of Belarus; Regulation
on the order of conditions confirmation for the exemption of import customs
duties and (or) VAT in terms of imported manufacturing equipment, component and
spare parts, and (or) materials and raw materials. In order to define the
priority types of activity (sectors of economy) the Resolution of the Council
of Ministers of the Republic of Belarus of 26.02.2014 № 179”On priority types
of activity (sectors of economy) “for benefits appliance according to the
Resolution of the Customs Union Commission as of 27.11.2009 № 130”On the single
customs and tariff regulation of the Customs Union of the Republic of Belarus,
the Republic of Kazakhstan and the Russian Federation“.

For reference:

Resolution of
the Council of Ministers of the Republic of Belarus as of 06.08.2011 №
1058 (ed. 19.02.2014) ”On implementation measures of the Decree of the
President of the Republic of Belarus as of
06.06.2011 № 4“ (Regulation on the order of conclusion, change, termination of
investment agreement with the Republic of Belarus; Regulation on the order
rules of the State register of investment agreements with the Republic of
Belarus; Regulation on the coordination order of the list of goods
(works, services), property rights, objects, acquired (imported to the
territory of the Republic of Belarus) and used for designing, construction
(reconstruction), fitting-out in investment project which is implemented
according to the investment agreement with the Republic of Belarus; Resolution
of the Council of Ministers of the Republic of Belarus as of 19.02.2014 № 149 ”On the approval of the
Regulation on the order of conditions confirmation for the exemption of import
customs duties and (or) VAT in terms of imported manufacturing equipment,
component and spare parts, and (or) materials and raw materials, as well
as introduction of changes and amendments to the Resolution of the Council of
Ministers of the Republic of Belarus as of 06.08.2011 №
1058 and 17.02.2012 № 156.

According to the results of
the annual survey of commercial organization, held by the Ministry of Economy
of the Republic of Belarus, the preferential regimes of the Republic of Belarus
are highly evaluated by investors.

In order to meet the
challenges of previous years and achieve the aims of the new five-year plan,
there were made some favorable changes in tax conditions for production of
innovative and high-technology products, sales of automobiles and auto parts of
the own production, in motorway service, filmmaking, tourism, etc.

In order to increase the
inflow of foreign investments, especially direct ones, which are of interest
for the republic, the concept «investment agent» has been implemented.

For reference:

Edict of the
President of the Republic of Belarus as of 06.08.2009 №
413.

These are individuals or legal
entities that have the necessary practical skills and experience in the
implementation of investment projects and which will assist the country in
search of potential investors.

In order to implement the
Edict № 413, there was developed the Regulation on the order of granting
authorities to individuals and legal entities in terms of representation of
interests of the Republic of Belarus on the issues of investment attraction to
the Republic of Belarus, validated by the Resolution of the Council of
Ministers of the Republic of Belarus as of
06.11.2009 № 1448 (ed. 27.09.2012).

There is Foreign Investment
Advisory Committee of the Council of Ministers of the Republic of Belarus
(FIAC) functioning in the Republic of Belarus. It consists of the
representatives of foreign companies, state bodies, and scientific
institutions. It facilitates the direct dialogue between the Government and
investors.

Permanent working groups of
the Committee deal with the improvement issues of investment legislation, tax
and customs terms of work at the Belarusian market and other issues.

In order to protect the rights
and legitimate interests of investors there was developed and adopted the
Regulation on pre-trial settlement agreement. According to the Regulation, investors under investment
agreement have the right to appeal to a state body for protection of their
rights and settlement agreement before
appealing to the court.

For reference:

Resolution of
the Council of Ministers of the Republic of Belarus as of 14.02.2012 № 146 (ed.
11.12.2013)”On the adoption of the Regulation on pre-trial settlement of
disputes (disagreements) referred to investments“.

In order to improve the work
on the attraction of foreign investment, raise the efficiency of privatization
processes in the Republic of Belarus and facilitate the interaction between
investors and state bodies, state institution «National Agency of Investment
and Privatization” was established in the Republic of Belarus.

For reference:

Edict of the
President of the Republic of Belarus of 25.05.2010 № 273 (ed. 21.02.2014) ”On
creation of state institution ”National Agency of Investment and
Privatization“.

The Agency facilitates the implementation of foreign direct investment, including the privatization of
state property. The Agency participates in the implementation of state policy
in the sphere of investments and privatization, monitoring and maintenance of
investment projects and privatization of state property, creating a positive
investment image of the country, providing a full package of services to
investors.

Active cooperation with
international organizations creates important prerequisites for the attraction
of foreign investments. Focused efforts are made to include the Republic of
Belarus in international economic processes.

In order to create the
conditions for covering risks of foreign investors on the territory of our
country, attract foreign financial resources without granting government
guarantees to foreign investors, and accordingly without the increase of external public debt of the
republic, the Government has taken some measures to join the Multilateral
Investment Guarantee Agency (MIGA). Having signed and ratified all the
necessary documents, in 2012 Belarus has become a full-fledged member of MIGA.

For reference:

MIGA is a member
of the World Bank Group. Its main tasks are to cover political risks and grant
guarantees for damage recovery in terms of non-commercial risks, promote
foreign direct investment (FDI) into developing countries, help to support
economic growth, reduce poverty and improve people's lives.

It confirms the readiness of
our country to follow the norms and standards of international economic
cooperation.

In order to create favorable
conditions for investments made by investors of one state at the territory of
another state, and acknowledging that the mutual assistance in implementation
and protection of such investments facilitate the development of business
initiative and increase of welfare of both countries, the Republic of Belarus
signed about 60 agreements on assistance in implementation (promotion)
and mutual protection of investment.

The agreements provide the
following guarantees:

national regime
(each party provides investors of the other country with the regime no less
favorable than it provides to investors of any other third country in the same
situation);

minimal
standards (each party provides the investments of other country with the regime
according to international law, including fair and equal regime, protection and
security, etc.);

expropriation
and compensation (none of the party has the right to expropriate or
nationalize investments both direct and indirect through measures which are
similar to expropriation or nationalization,with the exception of cases that are of public interest; on nondiscriminatory basis; correspond to the proper legal
procedure; under the condition of compensation payment, etc.);

other guarantees.

State investment policy is
focused on mobilization of all the efforts to attract investors, stimulate reinvestment
and create new high-technology production.

Resolution of
the Council of Ministers of the Republic of Belarus, National Bank of the
Republic of Belarus as of 18.01.2012 №
51/2 (ed. 11.12.2013) ”On the adoption of the strategy for foreign direct
investment attraction to the Republic of Belarus till 2015“.

The Attraction of foreign direct investments is
also meant to traditional types of economic activity. Clusters for
pharmaceutical and flax production should be developed.

Nowadays the main direction to
achieve the stated aims is to implement the policy of further liberalization of
business conditions, to improve the investment
protection mechanisms, which facilitate the investment activities, creation of
equal nondiscriminatory conditions of investment implementation for all
investors.

Significant steps have already
been made in this direction, which is reflected in evaluations of international
experts.

The Formation of favorable investment climate
and stimulation of foreign direct investment attraction to the Republic of
Belarus is held to achieve transparency of state bodies’ activity, adherence to
the principle of competitiveness, equal business conditions, protection of the
legitimate interests of investors and other individuals.

The Efforts of the Government of the Republic of
Belarus aim at the attraction of foreign investors and
liberalization of conditions for national investors for creation of new
production, modernization of the operating enterprises in order to produce
competitive products and therefore secure the investors’ income, and to raise
the standard of well-being for citizens.